Alteran Corpration purchased office equipment for 22 million

Alteran Corpration purchased office equipment for $2.2 million in 2015. The equipment is being depreciated over 8 year life using the sum of the years digits method. The residual value is expected to be $700000. At the end of 2018. Alteran decided to change to the straight line depreciation method for this equipment.

Prepare the journal entry to record depreciation for 2018

Solution

Calculate Depreciation expenses for 2018 :

Sum of year digit = 8+7+6+5+4+3+2+1 = 36

Prepare the journal entry to record depreciation for 2018